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CDM and the cloud: an unexpected security boost?

Jan 12, 2015

Sue Poremba – January 12, 2015 – CentralDesktop Blog –

Sales teams turn to the cloud

Channel data management (CDM) is helping businesses fine-tune their business operations, especially in areas of supply chain management. It allows companies to better understand how their products are moving off store shelves and in which locations those products sell well or don’t sell at all, with all of that data available immediately and anywhere, thanks to the cloud.

"The marketplace was begging for a solution that told business leaders all of that information about sales," said Mukund Ramaratnam, VP & GM, Zyme Applications at Zyme. "CDM is now becoming a glue that is connecting areas like supply chain management, sales execution, or payments."

In the past, CDM was controlled in-house, using low-tech tracking processes. As Dan Blacharski wrote in Cloud Computing Journal, "Manufacturers that focus on channel sales through distributors and resellers have traditionally operated with informal processes, using tools like spreadsheets and information driven by anecdotal stories from channel partners, unstructured data, and the ‘gut instinct’ of channel sales managers."

Now that process has moved to the cloud, allowing businesses to track their information instantly. For businesses that rely on effective product management and business intelligence, utilizing CDM can help the bottom line.

"What CDM is doing is taking the demand signals of the marketplace and delivering that into the operations decision center at a company," Ramaratnam explained. "It’s critical to know what is selling on a daily basis. As a manufacturing it is important to know how things are selling on a geographical basis, as well, in order to know how to drive operations. It’s information that a business needs to know now, not a month later, in order to keep competitive in today’s world."

3 key security benefits

At the same time, another less-discussed aspect of CDM is how it can add layers of security to business operations, particularly in the area of the supply chain. CDM can not only assist with physical security of intellectual property and product lines, but it can also play a role in data security issues.

According to Ramaratnam, there are three primary areas where CDM assists in physical security: control of the product, unauthorized shipping to foreign entities, and serial number tracking.

There is a serious problem with what Ramaratnam calls gray market activities, or the sale of products by unauthorized distributors. This results in loss of sales for the manufacturer. With CDM, the company is better able to track where the merchandise is going and better follow any type of unusual inventory levels.

Along similar lines is when products are shipped to countries where embargo bans are in place. CDM allows manufacturers to track the products via the distributors and resellers and discover if the products were shipped illegally to a country.

Serial number tracking lets businesses know where the merchandise is and is particularly useful in the case of theft of the product.

CDM can also help protect the manufacturer’s intellectual property and financials. First, a CDM provider will help the company meet with compliance issues and government regulations related to the industry. By adding encryption to the data, CDM providers ensure that the information is more difficult to steal.

"Overall, a CDM provider should offer best security practices to make sure the business operations are able to run smoothly and safely," Ramaratnam said. However, he does point out that security has to be a partnership, and the companies themselves are practicing good security hygiene. "When information is in the hands of a third party, you have to make sure they are doing whatever possible to make sure that data remains secure," he said.

"I think companies are making a trade off," he added. "They used to do CDM in-house with the idea that it was safer there. Now they realized that they needed a better, more effective solution, but at the same time as they considered moving to the cloud for their CDM solution, they needed to feel comfortable about security."

What these companies are discovering is that they are actually getting more security than they expected when moving to a cloud-based CDM solution.